He became active in the community through his involvement in Youth for Environmental Services in the 1980s. He served as CEO of Helping Hands Hawaii and director of the Makiki Community Library and of the Center for a Sustainable Future. In March 2010, Schatz stepped down from Helping Hands to run for lieutenant governor.
On January 10, 2010, Schatz announced his candidacy for lieutenant governor of Hawaii. His campaign priorities included the creation of clean-energy jobs, public education, and technological improvements in the public sector. He also declared his support for Hawaii House Bill 444, which would have allowed same-sex civil unions in Hawaii but was vetoed by Republican Governor Linda Lingle. A number of Hawaii labor unions endorsed Schatz for lieutenant governor in the Democratic primary, held on September 18, 2010. Schatz won the nomination with 34.8% of the vote, and thus became Abercrombie's running mate in the November general election.
On December 6, 2010, Schatz was inaugurated as Hawaii's 11th lieutenant governor alongside Abercrombie, who had defeated Republican incumbent Lieutenant Governor Duke Aiona in the gubernatorial election. Hawaii State Supreme Court Associate Justice James E. Duffy, Jr. administered the oath of office at the Coronation Pavilion on the grounds of ʻIolani Palace.
As of 2010, the National Rifle Association had given Schatz a "C" rating for his mixed voting record regarding gun law.